Orange juices up its defense

The summer was relatively quiet – patent case law-wise, that is. Thus, now may be a good time to go back on some interesting decisions issued during the first semester which I did not have time to comment upon.

In particular, and just in case you missed it a couple of months ago, I would like to showcase a procedural ruling issued by a case management judge, which addresses the evolution of the statute of limitations (for infringement claims) over time.

The lawsuit revolves around telecommunications equipment that was supplied by Alcatel-Lucent International to Orange SA, under a 2007 agreement. The equipment (called Network Analyzer 5530 or NA 5530) is believed by a U.S.-based company, Assia, to infringe two of its European patents. In July 2020, Assia had no fewer than four infringement seizures carried out at Orange, and then initiated infringement proceedings in front of the Paris tribunal judiciaire (TJ). Alcatel-Lucent was forced by Orange to join the lawsuit.

A procedural motion was filed by Assia to request access to some of the seized and sealed documents. As a counterclaim, the defendants requested that Assia’s infringement claims be declared time-barred, to the extent that they concern alleged infringement acts having taken place before August 6, 2015.

In order to address this request, the judge had to review the evolution of article L.615-8 of the Code de la propriété intellectuelle over time.

From 1992 to 2014, this provision was worded as follows:

Infringement actions […] are time-barred three years after the underlying facts.

As from March 12, 2014, the limitation period was increased to five years:

Infringement actions […] are time-barred five years after the underlying facts.

The limitation period of article L.615-8 was then further modified by the recent loi PACTE – not in terms of duration, but of starting point:

Infringement actions […] are time-barred five years after the day on which the owner of a right knew or should have known the last fact allowing them to act.

As you can see, patent infringement is not yet treated as seriously as crimes against humanity – which are not subject to any statutory limitation – but things are slowly moving in that direction.

Going way back in time – a patentee’s dream.

In the present case, the alleged infringement started in May 2010, when Orange began using the NA 5530 equipment. Therefore, the statute was amended twice between the start of the alleged infringement and Assia’s complaint.

In order to determine the proper limitation period, the judge applied two legal principles:

  • First, if a new statute makes a limitation period longer, the longer period immediately applies to any action which is not yet time-barred. But it does not apply to an action which has already been time-barred. This general principle is set in article 2222 of the Code civil.
  • Second, the entry into force of a new statute of limitations does not modify the starting point of a limitation period which has already started running based on the previous statute. This is based on established case law of the Cour de cassation.

In view of these principles, the judge ruled as follows:

  • Claims relating to alleged infringing acts dated between May 2010 and March 12, 2011 were already time-barred (under the three-year statute of limitations) on the day the increased five-year period entered into force, i.e. on March 12, 2014. Therefore, these claims remained and are still time-barred.
  • Claims relating to alleged infringing acts dated between March 13, 2011 and May 23, 2014 were already time-barred (under the five-year statute of limitations) on the day the modification of the starting point entered into force, i.e. on May 22, 2019.
  • Claims relating to alleged infringing acts dated between May 24, 2014 and August 5, 2015 are still subject to the pre-PACTE starting point, they are thus time-barred since the acts were more than five years old on the day the complaint was served, on August 6, 2020.

As a result, the only acts of alleged infringement which can still give rise to damages are those which took place on or after August 6, 2015.

Assia had argued that the loi PACTE was immediately applicable upon entry into force. This seems to be correct, but “immediately applicable” does not mean “retroactively applicable“. They had also argued that the infringement claim as a whole was not time-barred even under the previous statute, since the alleged infringement acts, namely using and keeping the equipment, were continuous acts; the limitation period in such a case only starts running once the continued acts have ceased – and in this case, Orange has never stopped using the NA 5530 equipment.

Remarkably, the judge did not have the same interpretation of the alleged infringement acts. She considered that the act of “keeping” the equipment (“détention” in French) corresponds to the one-time act of acquiring the equipment from Alcatel-Lucent. And that the use of the equipment should be considered as a succession of repeated, daily acts – not as a single, years-long continued act.

One practical takeaway is that the post-PACTE, patentee-friendlier starting point for the infringement limitation period only applies to infringement acts taking place as from May 23, 2019.

But I think the most controversial aspect of the ruling may well be the passage in which the acts of keeping and using equipment are said not to be of a continuous nature – I bet that not everyone would agree with this characterization.

The ruling contains a second part on the original subject of the procedural motion, namely how to deal with some of the documents taken during the infringement seizures and provisionally placed under seal, especially in view of the necessity to protect trade secrets.

This second part is also a must-read, since the new trade secret statute is still fairly recent (2018), and it is enlightening to see how it is applied by the courts in practice.

A few notable points in my opinion:

First, several successive versions of the Alcatel Lucent’s NA 5530 user guide were seized. In view of the judge’s finding on the statute of limitations, a number of the older versions of the user guide were deemed not relevant for the lawsuit (since the contemporaneous alleged acts of infringement were time-barred) and were thus ordered to be handed back to the seized party.

Second, concerning the more recent versions of the user guide (as well as a presentation by Orange on the user guide), the judge deemed that these documents could not be considered as trade secrets because they appeared to be easily accessible to the public, in particular on the collaborative scribd platform. This highlights the importance of putting effective restrictive measures of protection in place if a document is to be argued as relating to a trade secret.

On the other hand, the judge added that not the entirety of these documents were useful for the infringement suit. Therefore, the judge ordered that only redacted versions prepared by Alcatel Lucent be handed over to the plaintiff. In other terms, if some of the seized documents are not useful for the lawsuit, they should not be handed over to the patent proprietor, despite their unprotected nature – see articles R.153-5 to R.153-7 of the Code de commerce.

Third, another group of documents was held to relate to trade secrets. For those, the judge also ordered that only redacted versions prepared by Alcatel Lucent be handed over; but in addition, a confidentiality club was put in place for the access to the documents, comprising only one individual for each party, plus the attorneys at law and patent attorneys acting on behalf of the parties.

One question that can legitimately be raised, though, is how the plaintiff can react if too much information was redacted, in a case such as this one, as the redaction was not examined by an independent expert.


CASE REFERENCE: Tribunal judiciaire de Paris, 3ème chambre 1ère section, ordonnance du juge de la mise en état, Adaptive Spectrum and Signal Alignment Incorporated – Assia Inc. v. Alcatel Lucent International & Orange, RG No. 20/07066.

Breaking news: plausibility referral

This blog has been silent for a number of weeks now. Hopefully, regular posting will resume soon.

In the meantime, here is a very brief post today, to make all readers (on the beach or not) aware of a new referral to the Enlarged Board of Appeal, on a topic which enthralls the pharma patent crowd – and beyond – in every season, namely: plausibility.

The case of interest is T 116/18, pitching Syngenta Ltd. as the opponent against Sumitomo Chemical Company, Ltd. as the patentee. This case actually relates to an insecticide composition and not a pharmaceutical one.

Oral proceedings took place on July 22, 2021, and based on the minutes issued on July 30, 2021, it appears that the Board intends to submit three questions to the Enlarged Board, which are provisionally phrased as follows:

If for acknowledgement of inventive step the patent proprietor relies on a technical effect and has submitted data or other evidence to proof such effect, such data or other evidence having been generated only after the priority or filing date of the patent (post-published data):

1. Should an exception to the principle of free evaluation of evidence (see e.g. G 1/21 reasons 31) be accepted in that the post-published data must be disregarded on the ground that the proof of the effect rests exclusively on such post-published data?

2. If the answer is yes (post published data must be disregarded if the proof of the effect rests exclusively on these data): can post-published data be taken into consideration if based on the information in the patent application the skilled person at the relevant date would have considered the effect plausible (ab initio plausibility)?

3. If the answer to the first question is yes (post published data must be disregarded if the proof of the effect rests exclusively on these data): can post-published data be taken into consideration if based on the information in the patent application the skilled person at the relevant date would have seen no reasons to consider the effect implausible (ab initio implausibility)?

Let’s wait for the written referral decision and the final form of the questions, but it can already be guessed that the stakes will be very high for pharmaceutical companies and the so-called “chemistry” segment at large.

Thank you to my colleague Horst Vissel for first drawing my attention to this referral on LinkedIn. I seldom do breaking news, but it is the heart of the summer, everything is probably somewhat quieter on the big blogs, so it was now or never!

The show must go on

I have always been fascinated by the longevity of some soap operas.

As a teenager, I have memories of holidays at my grandparents’, with The Young and the Restless on TV. This show has been airing in the U.S. since 1973 and has recently reached its 12,000th episode milestone. (Un)fortunately for French viewers, the story started for them at episode 3,263 only. Anyway, sooner or later, even the oldest shows come to end. After 54 years of broadcasting, As the World Turns stopped in 2010.

As I have already mentioned a couple of times on this blog, one of the oddities of French patent litigation is that we have a few soap opera cases, which seem to go on and on for ages, fueled by a regrettable back-and-forth movement between the Cour d’appel and the Cour de cassation (i.e. the appeal court and the supreme court).

One such litigation, the numerous twists of which have given rise to many comments over the years, is the pravastatin case.

On May 21, 2021, the Paris Cour d’appel issued a batch of parallel judgments in this saga. Since they nicely and clearly summarize the main episodes of the dispute, I thought I might take this opportunity to present the updated facts to the readership.

The case revolves around SPC No. FR 92C0224 owned by the Japanese company Daiichi Sankyo Company Ltd. The SPC concerns the cholesterol-lowering drug pravastatin. It should have expired in August 2006. The SPC was filed by an IP law firm which can be referred to as L. But the renewal fees of the SPC were then paid by another IP law firm. Let’s call it W.

In 2004, the fourth renewal fee for the SPC fell due. It was duly paid by the W.  firm. However, the INPI (French IP office) made an extremely unfortunate mistake, and did not properly take the payment into account. On July 15, 2004, the INPI sent a warning communication to L., the first law firm which had filed the SPC application. The INPI received no response from the SPC proprietor or its representatives. It then issued a decision noting that the SPC had lapsed, on January 26, 2005. This decision was again sent to L., received the next day, and published in the official bulletin (BOPI) on March 25, 2005.

Nevertheless, it is apparently only a few weeks before the scheduled expiry of the SPC that the patentee realized what had happened.

On June 28, 2006, W. filed a request for cancellation of the decision of lapse on behalf of Daiichi Sankyo, explaining that the fourth renewal fee had been duly paid (as well as the following one in fact).

It took the INPI only a few days to dismiss this request for cancellation, in a decision dated July 3, 2006. The INPI’s position was that the deadline for challenging the decision had expired. Indeed, according to general rules of administrative law, an unlawful decision can only be canceled within 4 months from the date of the decision.

Daiichi Sankyo filed an appeal against both decisions (the decision of January 26, 2005 noting the lapse of the SPC, and the decision of July 3, 2006 rejecting the request to cancel this decision), in front of the Paris Cour d’appel. Teva intervened in these appeal proceedings, since they had launched their generic pravastatin drug on the French market in the meantime.

On March 14, 2007, the Paris Cour d’appel issued a first judgment, which canceled both INPI decisions, thereby reinstating the SPC.

The court reasoned that the decision of lapse was erroneous, and that it had not been properly notified to Daiichi Sankyo’s representative. Indeed, the law firm L. was only entrusted with filing the SPC application, whereas W. was in charge of handling the renewal fees.

Teva filed a cassation appeal (appeal on points of law), but the supreme court rejected it on July 1, 2008, holding that L.’s power of attorney was limited to filing the SPC application; that W. was not required to file a power of attorney with the INPI; that the communication of lapse was therefore not notified to the proprietor’s representative; and that the deadline for challenging the decision had accordingly never started running.

In April 2009, Daiichi Sankyo filed infringement actions not only against Teva, but also against a number of other generic drug companies that had similarly launched their respective pravastatin generics prior to the SPC expiry, namely Biogaran, Sandoz, EG Labo, Arrow, Mylan and Qualimed.

In an interesting turn of events, three of them, namely Sandoz, EG Labo and Biogaran, filed so-called third-party oppositions (“tierce oppositions“) to the 2007 judgment.

This is a procedure by which a person negatively affected by a judgment, although they were not a party to the proceedings leading to the judgment, may challenge this judgment.

In three parallel rulings dated February 20, 2012, the Paris Cour d’appel held that the oppositions were admissible but were not well-founded. It therefore let the 2007 ruling, which was favorable to the SPC proprietor, stand. Sandoz and Biogaran did not give up and filed respective cassation appeals.

In another stunning development, on June 25, 2013, the supreme court rejected Sandoz’ appeal but set aside the 2012 judgment involving Biogaran.

In the Biogaran ruling, the Cour de cassation reasoned that Daiichi Sankyo had not informed the INPI that the law firm W. was its representative. Therefore, the Cour d’appel should not have considered that the decision of lapse was not properly notified. In other words, a complete U-turn from the Cour de cassation’s own judgment issued five years earlier.

By the way, why did the Cour de cassation allow only Biogaran’s appeal but not Sandoz’ appeal? Simply because only Biogaran raised the winning legal argument, and the court is strictly bound by the parties’ submissions.

The Biogaran case was thus remitted back to the appeal stage.

Smelling blood in the water, three more generic companies filed their third-party oppositions to the 2007 judgment at this point, namely Mylan, Qualimed and Arrow.

Teva, who had lost the very first round, joined the proceedings (all three in fact). As a result, the Paris Cour d’appel issued three more parallel judgments on October 27, 2017.

In these new judgments, the Paris Cour d’appel (in a different composition) modified its 2007 ruling and held that the decision of lapse should stand after all (in keeping with the guidance offered by the Cour de cassation in 2013). Of course, Daiichi Sankyo filed a cassation appeal. Once again, on December 4, 2019, the cassation judges partly set aside the three 2017 judgments, but due to a mere technicality. Indeed, the 2017 judgments modified the reasoning of the 2007 ruling but failed to formally issue a new order.

And so, there we are again in front of the Paris Cour d’appel, with three brand new parallel judgments issued on May 21, 2021.

The show must go on.

In these judgments, the Cour d’appel once again reevaluated the facts.

The court focused in particular on the provision which is now known as article R. 612-2 Code de la propriété intellectuelle, per which applicants having their seat overseas must appoint a representative in order to act in front of the INPI. It is specified that “unless otherwise mentioned, the power of attorney extends to all acts and to the reception of all communications“.

The court then noted that the law firm L. was appointed as a representative by Daiichi Sankyo, without any express mention according to which L. was not empowered to receipt communications on behalf of Daiichi.

The court further stated:

The payment of the renewal fees as from 2001 by W. and not by L. cannot in itself justify a change of the representative in charge of receiving communications. Thus, the intervention of a second patent attorney, who did not have to justify their quality for the acts that they carried out, namely paying renewal fees, did not amount to informing the INPI of a change of representative, especially because the renewal fee receipts issued until May 2005 did not mention that W. was the representative. 

Therefore, only L. was properly registered as Sankyo’s representative when the warning before lapse was issued by the […] INPI […] on July 15, 2004 […]. The same applies to the notification […] of the decision of lapse issued on January 25, 2005 […]. 

Since the notification of these communications was proper, the request for cancelation of the INPI’s (unlawful) decision was filed too late. Therefore, the original 2007 judgment must be canceled, and the decision of lapse must stand.

Most importantly, the court noted the following:

The effect of the [INPI] decisions of January 26, 2005 and July 3, 2006 is that the ‘224 SPC has lapsed. This lapse can only be effective with respect to all. It cannot be divided. Indeed, an SPC cannot lapse with respect to some and remain valid with respect to all parties. Therefore, Daiichi’s auxiliary request that only the third-party opponent […] should benefit from the cancelation cannot be granted. 

End of the story? I would not bet on it, unless a general settlement takes place. First, Daiichi Sankyo may still file a cassation appeal. Second, regardless of this possibility, there may be a couple of spin-off proceedings still pending regarding other aspects of the case (such as infringement and liability of the INPI).

Anyway, these latest rulings seem to bring at least some sanity back to a crazy case.

The situation was difficult to handle for the judges from the onset, since all parties, to some extent, acted in good faith. On the one hand, the SPC should never have been declared lapsed, as the renewal fees were paid in time. On the other hand, the third parties were entitled to rely on the lapse of the SPC.

That said, the theory that, by stating ex post facto that there was a change of representative, and that a deadline never started running because the INPI communications were not properly notified to the new (unannounced) representative, was a severe blow to legal certainty. It is thus reassuring that this reasoning finally seems to have been set aside.

Furthermore, it would have been quite unfair if there had been winners and losers among the generic companies, depending on who raised which legal argument and when. It is therefore fortunate that the Cour d’appel has now clarified that the lapse of the SPC must have an erga omnes effect.

Now we just have to wait and see how this plays out next time, as the world turns its attention to the pravastatin case again – no longer young but seemingly forever restless.


CASE REFERENCE: Cour d’appel de Paris, pôle 5 chambre 2, May 21, 2021, SAS Biogaran v. Daiichi Sankyo Co. Ltd., RG No. 20/02952 & 20/04838.

A pro-choice ruling

Once in a while, a complex and long-lasting patent case gives rise to a simple and straightforward ruling.

Only longtime readers having an exceptional memory will remember that, a few years ago, I reported on a first cassation ruling in a Time Sport International v. Décathlon France et al. case. This ruling dealt with a priority issue.

It turns out that another cassation ruling has recently been issued in the same litigation. So this is one of these few never-ending cases in which the judiciary pingpong seems to go on eternally. Is it a bug or a feature of the French legal system? We may never know for sure.

Anyway, there is probably no need to go over the entire case in detail: as I said, the point made in this new ruling is quite simple and straightforward.

Suffice it to say that Time Sport International owns European patent No. EP 0682885 on a device for the adjustable occipital fixing of a helmet, and that Décathlon France and DHG Knauer were found to have infringed the French part of this patent. The only outstanding question is the computation of damages.

More innovation in the helmet business.

Damages were awarded to Time Sport by the Paris Cour d’appel in a judgment dated September 22, 2017 (corrected on May 4, 2018). Several amounts were awarded in consideration of different periods of time and defendants. The total amounted to more than 800,000 euros for Décathlon France, but (only) approximately 71,000 euros for Knauer.

The Cour de cassation, which only rules on points of law and does not reassess the facts, let the 2017 ruling stand for the most part, but took issue with one amount in particular, namely the one supposed to address Knauer’s infringement for the period running from November 1, 2007 to September 8, 2012.

Time Sport’s claim amounted to 1,754,483 euros. But the 2017 appeal ruling only granted them 28,620.90 euros. If the staff mathematicians are correct, this means that the court granted Time Sport 1.6% of what they asked for – obviously quite a disappointment for them.

The amount claimed by Time Sport was based on an expert’s report and was said to correspond to the profit made by Knauer. It seems that Knauer refused to communicate its sales figures relating to the infringing helmets to the expert, so that he made an estimate based on a minimum number of helmets sold by Knauer to Décathlon, on Décathlon’s average unit price and on Décathlon’s gross margin (not Knauer’s gross margin).

But the appeal judges noted that Knauer and Décathlon have different activities. Knauer is a manufacturer and wholesaler while Décathlon is a retailer. Therefore, the expert’s estimate based on Décathlon’s gross margin did not correctly reflect Knauer’s profits. As a result, the court decided that the damages should rather be computed by applying a 6% royalty rate to a certain turnover – how exactly this turnover figure was obtained is unfortunately not very clear to me when reading the judgment.

Time Sport argued in front of the Cour de cassation that this approach was incorrect.

The key provision here is article L. 615-7 Code de la propriété intellectuelle.

In the relevant version which was in force between October 30, 2007 and March 13, 2014, the article read:

To set the damages, the court takes into consideration the negative economic consequences suffered by the harmed party, including lost profits, the profits made by the infringer, and the moral prejudice caused to the right owner due to the infringement. 

However, the court may, as an alternative and upon request of the harmed party, award a lump sum as damages, which cannot be lower than the amount of royalties or rights which would have been due if the infringer had asked for a permission to use the right which was infringed.  

The amended version of the article currently in force is not much different from this one.

In summary there are at least three modes of computation laid out in the statute (leaving aside the moral prejudice aspect, which rarely gives rise to significant indemnification): the first one based on negative economic consequences for the IP right owner, the second one based on the infringer’s profits and the third one which is royalty-based.

The Cour d’appel applied the third one.

But these different modes of computation are not equally available to the court. In particular, the phrase underlined above shows that the third modality has to be requested by the plaintiff.

The Cour de cassation confirmed that there is no getting around the underlined phrase, and that the plaintiff indeed has the right to choose whether or not to be indemnified by way of a royalty:

The Cour d’appel, by ruling thusly, by refusing to take into account the indemnification claim based on one of the evaluation criteria set in article L. 615-7, first paragraph […] and by awarding the amount of royalties which would have been due to Time Sport if there had been a permission to work the patent, although a claim for enhanced royalties had not been filed, violated this provision by refusing to apply the first paragraph and by wrongly applying the second paragraph. 

The case is therefore again remitted to the (regular) appeal level to have this portion of the damages award reassessed.

This cassation ruling can be viewed as a useful clarification – although, frankly, I would say the provision at stake in the Code de la propriété intellectuelle was in fact clear enough.

What remains fuzzy to me is how the court should “take into account” both the first and second modes of computation (negative economic consequences and infringer’s profits). I am not sure the case law is crystal-clear in this respect (see also this previous post on the same topic).

What is also somewhat fuzzy is what happens if the defendant refuses to open its account books, as seems to have been the case here. Wouldn’t it be logical in such a situation for the court to simply follow the plaintiff’s estimate?


CASE REFERENCE: Cour de cassation, chambre commerciale, March 17, 2021, Time Sport International v. DHG Knauer GmbH et al., appeal numbers 17-28.221 & 18-19.206.

Exotic priority

Today’s post will be quite exotic. All right, let’s not overpromise; not quite Seychelles-exotic. But exotic nonetheless, for this blog at least.

For starters, the decision reported on was brought to my attention by my German colleague Frank Steinbach, from the law firm Zimmermann & Partner. Besides, the decision is a judgment issued by the General Court of the European Union, further to an appeal against a decision by a Board of appeal of the EUIPO (European Union Intellectual Property Office).

Not exactly my comfort zone, and yet this decision does belong on this blog. As you will see, it also has a strong patent law flavor.

Here are the – highly unusual – facts of the case.

On October 26, 2017, the German company The KaiKai Company Jaeger Wichmann GbR (hereafter KaiKai) filed a PCT application No. PCT/EP2017/077469 on a sports device for supporting a handlebar for performing push-ups. Approximately one year later, on October 24, 2018, KaiKai filed a multiple community design application for 12 designs, on a sports device, claiming the priority of the PCT application.

The EUIPO examiner refused to acknowledge the priority right, as the community design application was filed after the expiry of the 6-month priority community design deadline. The applicant requested an appealable decision, which was issued on January 16, 2019. KaiKai filed an appeal, and the decision was issued on June 13, 2019 by the Board of appeal of the EUIPO.

At this point, let’s marvel for a moment at the swiftness of soft IP procedures. For a patent person, it looks almost preternatural.

Anyway, the Board agreed with the examiner and rejected KaiKai’s appeal. KaiKai did not waver and filed a further appeal in front of the General Court of the European Union, which gave rise to the decision commented upon today.

Is this a sports-related patent application or design right application?

Before we continue, we should probably have a look at the relevant legal provisions, both in the Paris Convention and in Council Regulation (EC) No. 6/2002 of December 12, 2001 on Community designs (the Community design regulation).

Let’s start with Article 4.A.(1) of the Paris Convention:

Any person who has duly filed an application for a patent, or for the registration of a utility model, or of an industrial design, or of a trademark, in one of the countries of the Union, or his successor in title, shall enjoy, for the purpose of filing in the other countries, a right of priority during the periods hereinafter fixed.

The periods in question are specified in article 4.C.(1):

The periods of priority referred to above shall be twelve months for patents and utility models, and six months for industrial designs and trademarks.

But then article 4.E.(1) contains the following specific provision:

Where an industrial design is filed in a country by virtue of a right of priority based on the filing of a utility model, the period of priority shall be the same as that fixed for industrial designs.

Turning next to the Community design regulation, the relevant part is article 41(1):

A person who has duly filed an application for a design right or for a utility model in or for any State party to the Paris Convention for the Protection of Industrial Property, or to the Agreement establishing the World Trade Organisation, or his successors in title, shall enjoy, for the purpose of filing an application for a registered Community design in respect of the same design or utility model, a right of priority of six months from the date of filing of the first application.

It is important to note here that article 41 does not mention the possibility to claim priority from a patent application, only from a utility model application.

The Board of appeal of the EUIPO held that article 4 of the Paris Convention applies to the European Union, via the TRIPS agreement. However, the Board added that there is no primacy of the Paris Convention over the Community design regulation, since the latter is not a “special agreement” as provided in article 19 of the Paris Convention.

The Board then held that article 41 of the Community design regulation unambiguously sets a 6-month priority deadline from the first filing, which can be an application for a design right or a utility model.

Referring to the Guidelines for examination of registered Community designs (section 6.2.1.1), the Board found that it is not possible to claim priority from a patent application. However, a PCT application can be considered as a utility model application, by virtue of article 2.(i) PCT: “references to an ‘application’ shall be construed as references to applications for patents for inventions, inventors’ certificates, utility certificates, utility models, patents or certificates of addition, inventors’ certificates of addition, and utility certificates of addition“. Therefore, according to EUIPO practice, claiming priority to a PCT application is allowed. But then, it is considered as an application for a utility model, so that the 6-month priority deadline must be observed.

The Board finally added that this is consistent with article 4.E.(1) of the Paris Convention, which provides a 6-month priority deadline when an industrial design application claims priority to a utility model application.

In front of the General Court, KaiKai criticized the Board’s reasoning as follows:

  • Article 41 of the Community design regulation does not explicitly handle a priority claim to a PCT application.
  • Therefore, the Paris Convention should be applied, and more specifically article 4.C.(1) which provides a 12-month priority deadline for patent applications.
  • Indeed, a PCT application cannot only be considered as a utility model application.

What was the General Court take on this?

As a first step, the General Court approved the EUIPO and the Board for acknowledging that a Community design may claim priority to a PCT application despite the absence of mention of patent applications in article 41 of the Community design regulation.

Indeed, a PCT application can, in some contracting states, be considered as a utility model application. Says the court (my own translation, since the ruling is available in many languages but not in English):

In these circumstances, in order not to unjustifiably exclude some of the utility model applications, the EUIPO’s extensive interpretation allows all international patent applications filed under the PCT to be accepted as a basis for a right of priority, thus avoiding impeding the legal protection of industrial property rights covered by the PCT. While international patent applications may thus give rise to a priority right for designs under Article 41 of Regulation No 6/2002, however, this does not necessarily transform patent applications into model utility applications or automatically subject them to the rules designed for them.

As a second step, the court noted that article 41 of the Community design regulation does not contain any provision on the priority deadline for a priority claim to a patent application.

Looking at the Travaux préparatoires and at the wording of article 41 itself, the court found that the purpose of this article was to conform to the rules of the Paris Convention and the TRIPS agreement. Therefore the Paris Convention should be taken into account when interpreting article 41 of the Community design regulation. The court added that this is not really a matter of primacy of the Paris Convention over the regulation, but rather a matter of filling a gap in the regulation owing to the Paris Convention.

This led the court, as a third step, to look more closely at the articulation between article 4.C.(1) (12-month priority deadline related to patent and utility model application filings) and article 4.E.(1) (6-month priority deadline for an industrial design claiming priority to a utility model application filing) of the Paris Convention:

It follows from the logic inherent in the priority system that, as a general rule, it is the nature of the earlier right which determines the duration of the priority period. In this regard, it should be noted that the reason why […] the priority period applicable to patents and utility models is longer than that applicable to designs and trademarks results from the more complex nature of patents and utility models. In fact, given that […] the procedure for the registration of patents or utility models is longer than that of designs or trademarks, the priority right resulting from the filing of a patent or utility model application would run the risk of expiring if the same relatively short period of six month was applied to all rights that could give rise to a right of priority. However, the advantage that the right of priority is supposed to provide is to allow the applicant to assess the chances of obtaining protection for the invention concerned on the basis of the earlier patent application filed in a state before possibly seeking, by a subsequent application, to obtain protection in another state by carrying out the necessary steps and preparations and by setting out the costs and formalities relating thereto.

[…]

In addition, it appears consistent that the nature of the earlier right determines the duration of the priority period, since […] it is the application for registration of this earlier right which gives rise to the right of priority. Furthermore, it is from the date of filing of the said application that the priority period begins to run. If the actual birth of the right of priority as well as the start of the period of said right depend on the earlier right and the application for its registration, it is logical that the duration of the right of priority also depends on the earlier right.

The court also reviewed the Travaux préparatoires of the Paris Convention which seem to confirm this view.

But then how should we deal with article 4.E.(1)? Well, the court interpreted this article as being a specific, exceptional provision – based on a textual analysis of the article and based on a historical analysis of the adoption of the article. They considered that the reason for the exception was the short registration procedure for utility models. In particular, utility models are generally published before the 12-month milestone – but patent applications are not:

[…] the objective behind Article 4, Section E, paragraph 1 of the Paris Convention does not concern patent applications. Indeed, the risk of a long-published patent being re-filed as a design is almost non-existent, as is confirmed by the present case […]. 

This finally brings us to the court’s conclusion:

It must be noted that the arguments that the EUIPO puts forward in support of the contrary position are not such as to call into question the conclusion that the general rule underlying the Paris Convention is that the nature of the earlier right is decisive for determining the duration of the priority period. In particular, the EUIPO does not make any argument that could establish that the special rule created for utility models should also apply to patents.

Consequently, it must be concluded that the Board of Appeal erred in considering that the time limit applicable to the claim by the appellant of the priority of the international patent application PCT/EP2017/077469 for all twelve designs for which it applied for registration was six months.

Congratulations to Frank and his colleagues, for this nice result! The matter may still be referred as a last stage to the highest level, namely the Court of justice of the European Union – wouldn’t it in fact be surprising if this were not the case?

Now, assuming that this ruling holds, how far-reaching is it? Is it now possible to file a Community design, claiming priority to a patent application other than a PCT application, within a 12-month deadline? This is actually not so clear based on the judgment.

Indeed, the court seemed to approve the EUIPO’s practice to consider a PCT application to be a proper basis for a priority claim by a Community design, because a PCT application can also be considered as a utility model applications. If this is so, the reasoning would not necessarily extend to other patent applications (for example to a direct European application, or a national application). And yet, a patent application is a patent application, PCT or no PCT…

Furthermore, it seems somewhat far-fetched to consider that priority based on a PCT first filing may be claimed because said first filing is (at least virtually) a utility model application, but then, for the purpose of computing the deadline, to consider this first filing as a patent application, and thus to skip article 4.E.(1) which sets a special rule for claiming priority to a utility model application.

Wouldn’t things be more consistent if all patent applications gave rise to a 12-month priority right for design rights, based on articles 4.A.(1) and 4.C.(1) of the Paris Convention? This would require taking the “filling the gaps in the regulation” approach one step further. Would it be one step too far for the Court of justice?

Let’s stay tuned!


CASE REFERENCE: General Court of the European Union, April 14, 2021, The KaiKai Company Jaeger Wichmann GbR v. EUIPO, T-579/19.